Service disconnection for non-payment by residential customers

24 February 2005

In October 2002 Oftel and the telecoms industry published guidance on how telephone companies can help consumers manage their phone bills and avoid being disconnected.

The guidance recommended that all telephone companies produce codes of practice that will give residential consumers advice on issues such as the payment of bills and how to minimise the risk of getting into debt. In particular, it sets out areas of policy that telecoms companies should address and provides standards of best practice in these areas.

The aim is for telecoms companies to promote consumer awareness of their disconnection procedures, and encourage greater consistency within the telecoms industry on such issues. The guidance was put together by the Disconnections Steering Group, chaired by Lady Pauline Ashley and including telecoms companies who have over 90% of the residential fixed call market between them. They have agreed to follow the guidance in their future codes of practice on disconnection.

The guidance is in line with the Communications White Paper which stated that the telecoms industry should assume more responsibility for the payment of customer bills and disconnection levels.

Although primarily aimed at fixed telephone companies, the guidance sets out principles that could be adopted more widely by other operators such as mobile service providers.

Disconnections data

The data below shows disconnections for non-payment per 100 lines, less those customers who have been re-connected in the quarter on payment of their bill. The data is collected quarterly and is audited externally. The data covers residential customers of direct switched services only. This measure indicates the extent to which an operator is effective in avoiding disconnections of telephony service for those customers who may have difficulty in paying their bills. The data follows the common definition of disconnections agreed by the industry and consumer groups:

"A disconnection is an action taken by the telecoms operator to prevent the customer both from making out-going calls and from receiving any in-coming calls. A customer who is left only with the residual ability to call the Emergency Services and/or the Operator providing their telecoms services is counted as disconnected for the purposes of this measure. Barring of outgoing calls only does not constitute a disconnection of service. Disconnections for non-payment are those disconnection actions taken in cases where the operator considers that the customer has failed to pay sums due for the telephony service provided."

The measure does not include cessation of service at the request of the customer, for example where the customer moves house or changes telephone company.

Number of disconnections for non-payment per 100 lines (net) (disconnections minus reconnections), January 1998 to June 2002